STOCK MARKET UPDATE: 12.10.2012

STOCK:

Karachi Stocks Up 87.00 Points:
KARACHI, Oct 11: St the close of trading, the KSE-100 index was at 15840.82, up 87.00 points.

 (Today Market is 136.05 Up @ 11.05 am)

KSE:Bull-run continues, index at record high
KARACHI, Oct 11: The Karachi Stock Exchange breached two record levels on Thursday as the benchmark index hit a fresh all-time high at 15,917.09 and also managed to close at its highest ever closing of 15,845.30, due to buying in blue chips especially OGDCL and the banking sector.The KSE 100-share index ended 0.58 per cent, or 91.48 points.
The previous all-time high was 15,830.17 made on Wednesday and record high closing was at 15,788.96 hit on Oct 4.
Volume, however, fell to 106.9 million shares, compared with 132.83 million shares traded on Wednesday. Trading value stood at Rs3.71 billion, compared with the previous day’s Rs4.866 billion. But market capitalisation increased to Rs3.95 trillion from Rs3.96 trillion on Wednesday.
“Local bourse once again closed at a historic high of 15,845 points level primarily contributed by OGDC and Nestle Pakistan but volume shrunk by 30 per cent to Rs3.7 billion,” said Samar Iqbal, a dealer at Topline Securities ltd.
Dealers said there was fresh buying also in anticipation of healthy corporate profits for the quarter ended Sept 30, due to be announced in the coming weeks.
Energy sector would remain in the limelight as Brent crude oil reached its highest in a month on Thursday, lifted by escalating tension between Syria and Turkey and a supply crunch in oil products following maintenance in the North Sea.
OGDCL ended Rs1.35 to Rs177.93.
But dealers said some investors could be cautious and would indulge in profit booking as the index was at record high.
“The cheaper financing rate of about 12 to 12.5 per cent available in the CFS market and growing confidence of the lenders should drive the market higher with occasional profit taking,” said Ahfaz Mustafa, Director at Ismail Iqbal Securities Ltd.
Foreign investors were active in the market as they bought shares worth $3.472 million, compared with new outflows of $1.51 million the previous day, bringing the total net buying for this month at $20.67 million. Individuals were the major sellers of equity with $2.4 million.
The market capitalisation based KSE 30-index gained 0.12 per cent, or 15.58 points, to close at 13,063.89 points.
Out of the 351 companies traded, the value of 173 increased, 157 decreased, while 21 remained unchanged.
Nestle Pakistan witnessed the highest increase in share value as it gained Rs260 to Rs5,460 followed by Colgate Palmolive, which was up by Rs64.50 to Rs1,354.50.
But UniLever Pakistan saw the largest fall as it shed Rs445 to Rs9,750 followed by National Foods as it fell Rs7.52 to Rs272.74.
The list of top 10 volume leaders was topped by PTCLA which gained 18 paisa to Rs19.98 on turnover of 15.96 million shares, Engro Foods rose Rs1.42 to rs71.39 on 5.1 million shares and Askari Bank closed 9 paisa higher at Rs15.86 on 4.71 million shares.Summit Bank rose 22 paisa at Rs3.20 on 4.26 million shares, National Bank of Pakistan 16 paisa to Rs44.91 on 3.87 million shares and Bank of Punjab ended 10 paisa higher at Rs8.36 on 3.83 million shares.
Saritow Spinning rose 88 paisa at Rs4.55 on 3.55 million shares, Engro Corp shed 22 paisa at Rs102.05 on 3.18 million shares, Nishat Chunian gained 19 paisa at Rs26.74 on 2.95 million shares and Hub Power Co Ltd closed 42 paisa higher at Rs45.89 on turnover of 2.87 million shares.
Settlement guarantee fund
ISLAMABAD, Oct 11: While Islamabad and Lahore stock exchanges have approved establishment of a Settlement Guarantee Fund covering all the three stock exchanges to be managed by NCCPL, the Karachi Stock Exchange has strongly opposed the idea of any centralised bailout fund.
The basic idea behind the establishment of settlement fund was to bring transparency in the trading and clearing systems after the demutualisation of stock exchanges and provide protection to the investors under the new market scenario.
The Settlement Guarantee Fund would be utilised in case of default of any broker of the three bourses.
The Securities and Exchange Commission of Pakistan (SECP) has asked the boards of exchanges to approve establishment of a settlement fund under the patronage of National Clearing Company of Pakistan Limited (NCCPL), since this agency is responsible for settlement of all trades done by the brokers.
The ISE board has approved the establishment of the Settlement Guarantee Fund, and the ISE management has agreed to transfer around Rs5 million from the Members Protection Fund.
The LSE has also agreed to the SECP plan, but the main hurdle is to convince the KSE, which exercise a key role among the capital markets.
“We have collected Rs3 billion in the head of Clearing House Protection Fund and this money belongs to our members,” said Yasin Lakhani, director KSE. “Why do we shift this money on bureaucratic decisions?”
He added that the KSE has its own dynamics and not aligned with the situation in Islamabad Stock Exchange.
“If it rains in Islamabad – we will not carry umbrellas,” Mr Lakhani said. “We have given risk management guarantees to the SECP about the conduct of our members.”
However, he added that in case of frauds and other gross irregularities the main responsibility to control the proceeds lies with the NCCPL and the SECP.
Meanwhile, an SECP official talking to Dawn expressed confidence  that the KSE would be convinced and a segmented Settlement Fund would be established soon.
It is expected that a SECP team will precede to Karachi next week.
Company news:
NIT announces result of 5 funds: KARACHI, Oct 11: National Investment Trust Limited (NITL), on Thursday reported earnings for its five funds for quarter ended Sept 30, with NI(U)T fund outperforming the Karachi Stock Exchange 100-share index.
NI(U)T fund net asset value (NAV) increased 12.25 per cent, compared with a rise of 11.91 per cent of KSE-index while the dividend income warned by the fund grew 16.2 per cent to Rs472 million, compared with Rs406 million in the same period last year.
It also realized capital gains of Rs175 million in July-Sept quarter, against Rs129 million in the corresponding period last year.
The NIT State Fund Enterprise Fund (NIT-SEF) NAV increased 11.89 per cent, marginally lower than the increase of 11.91 per cent of KSE-index. The net income of the fund, excluding impairment losses, stood at Rs538 million which translated into an earning per unit of Rs4.35, lower than Rs4.46 during the same period last year.
The NIT Equity Market Opportunity Fund (NIT-EMOF) NAV rose 9.58 per cent, underperforming the KSE-index.
It earned a net profit (excluding impairment losses) of Rs180 million, earning per unit of Rs3.81 as compared to an earning per unit of Rs3.16 during the corresponding period last year.
NIT Government Bond Fund (NIT GBF) earned a net income of Rs77.38 million n the first quarter of 2012-13, which translate into an earning per unit of Rs0.2451 compared to an earning per unit of Rs0.2754 during the corresponding period last year.
The NAV of NIT Government Bond Fund yielded an annualized return of 12.44 per cent against the benchmark rate of 9.94per cent. As of Sept 30, the net assets of NIT Government Bond Fund stood at Rs3.23 billion.
The fifth fund, NIT Income Fund (NIT IF) earned a net income of Rs80.44 million in quarter ended Sept. 30, an earning per unit of Rs0.3115, compared to an earning per unit of Rs.0.3458 during the corresponding period last year.
MOHAMMED SALEEM MANSOORI